The Bureau of Labor Statistics has released the Employment Situation Summary, commonly known as the “jobs report,” for May. While many news outlets had headlines lauding May’s jobs numbers, at least some are beginning to come around to a fact that we have been stating for months: too many of these new jobs are in low-wage work.
Rather than being good jobs that pay enough to meet basic needs, these jobs leave working families without the ability to make ends meet.
Nonfarm payroll, which includes all industries that are not farm-related, increased by 280,000 in May. Most of that increase comes from service-providing industries like retail. Unfortunately, a significant portion of these jobs are in traditionally low-paying industries, with three of the top four increases in service-providing industries that have average hourly earnings below $15 per hour.
This includes industries we’ve called out before like leisure and hospitality (which includes food service) and retail, as well as professional and business services. Additionally, within professional and business services, a large portion of the growth came from temporary help services – jobs that do not ensure stable employment.
The May Jobs Report showed a continuation of a trend away from high-paying jobs and toward low-paying and even temporary employment. As we reported in “Low Wage Nation,” there are not enough good-paying jobs to go around, and growth in low-wage industries only exacerbates the problem.
With seven job seekers for every job opening that pays at least $15 per hour, too many working families will continue to struggle, even with May’s job growth.
However, there is some hopeful news in the May Jobs Report, as well. The industry with the highest increase in employment was Education and Health Services, with most of that increase coming from Health Care and Social Assistance.
As mentioned in “Low Wage Nation,” occupations in this industry pay relatively high wages, and are a great investment for states as they create good jobs and help working families care for their own health, as well. While the BLS data does not specify where this job growth originated, it is likely that at least some of it is due to continued implementation of the Affordable Care Act and the growing number of states that have expanded Medicaid.
Moving forward, we hope that this strong increase in health care jobs continues. However, investment in even more high-paying industries also needs to be a priority, as does increasing wages across the board so that all jobs can become good jobs. Until then, as long as employment growth continues to happen largely in lower-paying industries, working families will struggle to make ends meet without enough high-paying jobs to go around.